Asian stocks surge as Micron earnings ease AI fears

Asian equities saw significant gains driven by optimistic earnings from tech giants Micron and Qualcomm, which alleviated concerns regarding the AI sector's high valuations. Major indices in Japan and South Korea rose sharply, with the Nikkei increasing over 4% and the KOSPI gaining 5.5%. While investor sentiment was bolstered by strong earnings reports, analysts expressed caution about sustaining the rally amid valuation concerns. Meanwhile, oil prices returned to pre-war levels, supporting expectations of lower inflation, but concerns over the Federal Reserve's potential rate hikes persist as the dollar strengthens, impacting currencies like the Japanese yen, which is nearing a 40-year low.

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Companies
Blowout earnings help lift mood on AI
Rising rat-hike bets buoy dollar
Yen near 40-year lows as intervention risks loom
Oil prices at pre-war levels as tankers pass through Hormuz

SINGAPORE, June 25 (Reuters) - Asian equities surged on Thursday after strong earnings and forecasts from chip giants Micron and Qualcomm helped alleviate some concerns over the red-hot AI rally that has pushed global stocks to record highs.

Tech-heavy markets in Japan and South Korea rose sharply after Micron (MU.O), opens new tab said its customers ‌had committed $22 billion for its memory chips, while Qualcomm (QCOM.O), opens new tab anticipates $15 billion in sales from its data centre business by 2029.

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MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS), opens new tab was 1.6% higher. Japan's Nikkei (.N225), opens new tab rose over 4% while South Korea's KOSPI (.KS11), opens new tab gained 5.5% and Taiwan stocks (.TWII), opens new tab was 0.9% higher.

Futures for S&P 500 rose 0.5% while Nasdaq futures jumped 1.8%. European futures though were flat.

"It doesn't take much to restore confidence among stock traders, especially when mega themes such as AI are the main driver," said Matt Simpson, senior market analyst at StoneX.

"Until the wheels truly fall off the global economy, traders will look for any excuse to buy a dip. This week's excuse was ⁠Micron," he said.

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Investor concern that valuations for AI-related companies have become stretched following years of gains has weighed on markets in recent days, leading to volatile sessions.

Analysts though remain sceptical of a long sustained rally in AI stocks as those valuation worries linger.

"It's a positive from Micron," said Nick Twidale, chief market strategist at ATFX Global in Sydney, who expects a strong move higher on the back of the earnings.

"But I'm not sure how long the euphoria will last across the rest of the sector... I think valuation concerns will continue to weigh on sentiment moving forward," he said.

Also aiding sentiment was announcement from South Korea's SK Hynix (000660.KS), opens new tab on Wednesday of plans to raise up to $29.52 billion through a secondary listing on Nasdaq to capitalise on unending investor appetite for AI stocks.

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A stock quotation board is reflected on window glasses at a building in Tokyo

A stock quotation board is reflected on window glasses at a building in Tokyo, Japan December 11, 2025. REUTERS/Issei Kato Purchase Licensing Rights, opens new tab

Shares of SK Hynix and Samsung Electronics (005930.KS), opens new tab have powered the KOSPI to record highs through the year, taking the year to date gains for the index to 112% and making it the best-performing stock market in the world.

OIL BACK TO PRE-WAR LEVELS AS TANKERS EXIT HORMUZ

Oil prices extended their ‌decline as stranded tankers ⁠exited the Strait of Hormuz following an initial accord to end the U.S.-Israeli war with Iran, easing supply concerns.

Brent crude futures dipped 1.6% to $72.53 a barrel, erasing all of its gain from the war. U.S. West Texas Intermediate fell over 1% to $69.36 a barrel.

Easing oil prices may help reduce some inflation pressure but elevated prices are likely to keep the U.S. Federal Reserve under pressure to raise interest rates with investors pricing in at least one rate increase this year.

Thursday's PCE inflation report is expected to show core prices rose 0.3% in May, putting the annual rate at ⁠3.4%. Headline inflation is forecast at 0.5% for the month and 4.1% year-over-year.

Rising expectations of a rate hike have boosted the dollar, putting the Japanese yen near its lowest in 40 years and on the brink of more intervention from Tokyo after the last bout around May failed to stem the fragile currency's decline.

The yen was last at 161.73 per U.S. dollar, not far from the ⁠two-year low it hit last week. A break below 161.96 would take yen to its lowest level since 1986.

Vincent Chung, a Hong Kong-based fixed-income portfolio manager at T Rowe Price, said an intervention that just comes from Japan is unlikely to be effective.

"You look at history, and more coordinated moves with other central banks tends to be more effective ... so ⁠if it's not just a rate check, that could be a bigger move."

The dollar index , which measures the U.S. unit against a basket of currencies, was at 101.6 after reaching 101.80 in the previous session, its highest since May 12, 2025.

The strengthening dollar has weighed on gold, which slid below $4,000 an ounce for the first time in 2026. Spot gold last fetched $3,990 per ounce, hovering near its lowest since November.

Reporting by Ankur Banerjee in Singapore; Editing by Kate Mayberry and Shri Navaratnam

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Asian stocks surge as Micron earnings ease AI fears

OIL BACK TO PRE-WAR LEVELS AS TANKERS EXIT HORMUZ

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